American Community Survey (ACS) Data Uncertainty and the Analysis of Segregation Dynamics

American Community Survey (ACS) data have become the workhorse for the empirical analysis of segregation in the U.S.A. during the past decade. The increased frequency the ACS offers over the 10-year Census, which is the main reason for its popularity, comes with an increased level of uncertainty in the published estimates due to the reduced sampling ratio of ACS (1:40 households) relative to the Census (1:6 households). This paper introduces a new approach to integrate ACS data uncertainty into the analysis of segregation. Our method relies on variance replicate estimates for the 5-year ACS and advances over existing approaches by explicitly taking into account the covariance between ACS estimates when developing sampling distributions for segregation indices. We illustrate our approach with a study of comparative segregation dynamics for 29 metropolitan statistical areas in California, using the 2010–2014 and 2015–2019. Our methods yield different results than the simulation technique described by Napierala and Denton (Demography 54(1):285–309, 2017). Taking the ACS estimate covariance into account yields larger error margins than those generated with the simulated approach when the number of census tracts is large and minority percentage is low, and the converse is true when the number of census tracts is small and minority percentage is high.